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East Africa Tax Alerts

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We strive to keep you updated on tax developments in the East Africa Region. Our Tax Alerts contain detailed analysis of recent tax measures and their implications on businesses operating in the region.

Recent alerts and an archive of alerts from the previous 12 months appear below; for older issues, please email a request to tax@deloitte.co.ke

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Recent Alerts

Keeping you in the loop: Tanzania Court of Appeal’s decision on waiver of objection deposits

The Court of Appeal of Tanzania issued a ruling regarding an Appeal on the Commissioner General’s decision on waiver of objection depositson 31 May 2019. We have prepared this alert to give you a summary of the ruling and its potential implications to your business. Read more....

High Court yet again, rules in favour of the taxpayer on the VAT treatment of internationally traded services

The High Court of Kenya, at Nairobi, in its decision in Panalpina Airflo Limited vs Commissioner of Domestic Taxes (Income Tax Appeal No. 5 of 2018) has upheld the application of destination principle in determining the country with taxing rights over internationally traded services. In doing so, the Court held that the Appellant’s services were exported and therefore zero-rated for VAT. The Court further held that the Appellant was entitled to the refund of any excess input tax arising from the provision of the impugned services. Read more......

KRA issues update on VAT Auto Assessments (VAA)

The VAT Auto Assessment (VAA) tool was rolled out in October 2018 and piloted on the January 2018 VAT return. The tool was aimed at cross-validating input tax claimed as credit by purchasers against corresponding output tax declared by sellers.  Read more....

Gazettement of Tax Appeals Tribunal members; Introduction of Tax Invoice Management System & Housing Fund levy update

In accordance with the Tax Appeals Tribunal (TAT) Act, new members have been appointed to the TAT by the Cabinet Secretary for the National Treasury and Planning for a period of 3 years through a Gazette Notice published on 15 April 2019.  Read more....

Mauritius Double Taxation Agreement (DTA) Ruling and Housing Levy Update

The High Court of Kenya, Constitutional, Judicial Review and Human Rights Division, sitting in Nairobi, on 15 March 2019 delivered judgement declaring that Legal Notice No. 59 of 2014, gazetting the Kenya – Mauritius DTA, was not properly laid out.... Read more....

Requirement for HR Professionals to attach a Clearance Certificate from the Institute of Human Resource Management to Work Permit Applications

The Department of Immigration Services is in the process of implementing a directive, requiring work permit applications under the Human Resource field to be accompanied by a clearance certificate from the Institute of Human Resource Management. Read more....

Deloitte Africa Tax & Legal Appeal Court ruling on withholding tax

The Kenyan Court of Appeal delivered a judgement on 5 February 2019 to the effect that an accrual (of an expense) in the books of accounts falls within the meaning of the word “paid” for Income Tax purposes and therefore withholding tax becomes due upon such accrual. Read more....

Tax Alert - Appeal Court ruling on withholding tax

The Kenyan Court of Appeal delivered a judgement on 5 February 2019 to the effect that an accrual (of an expense) in the books of accounts falls within the meaning of the word “paid” for Income Tax purposes and therefore withholding tax becomes due upon such accrual. Read more....

Tanzania’s amended Value Added Tax Regulations

The Value Added Tax (General) (Amendment) regulations, 2018 effected on 19th Oct have implications for financial services as well as touching upon other industries. Issues addressed include deferment of capital goods, apportionment of input tax among other prescribed requirements. Read more....

Tanzania’s new Transfer Pricing Regulations

The Tanzanian Tax Administration (Transfer Pricing) Regulations, 2018 (“TP Regulations 2018”) are now in force, repealing the previous regulations that have been operational since February 2014. The new regulations require more detailed documentation and supporting information and impose stricter penalties for non-compliance. Read more...

High Court declares VAT not applicable on sale or purchase of land irrespective of the nature of buildings situated thereon

The High Court of Kenya, Commercial & Admiralty Division, sitting in Nairobi, on 29 November 2018 delivered judgement declaring that Value Added Tax (VAT) is not applicable on transactions for the sale or purchase of land. The Court further noted that for VAT purposes, it is immaterial whether the buildings situated on the land are residential or commercial. Read more...

Kenya Revenue Authority seeks to introduce requirement for oil marketers to issue ETR compliant invoices  - 9 November 2018

In a stakeholder seminar held by the KRA on 25 October 2018 for the Petroleum and LPG sector, the revenue authority indicated that it is expected of oil marketers to issue Electronic Tax Register (ETR) or Electronic Signature Device (ESD) compliant tax invoices to all buyers. Read more

KRA comes up with new measures aimed at improving Value Added Tax compliance - 1 November 2018

The Kenya Revenue Authority has commenced implementation of an online tool that will generate automated VAT assessments through the iTax platform. In this alert, we discuss the key features of this tool and highlight our view on this initiative. Read more

Changes in the work permit application process - 28 August 2018

Following the administrative and policy changes recommended last month, the Government of Kenya has directed that all foreigners wishing to work in Kenya should have a work permit approved and issued before they can travel to take up their assignment in the country.. Read more

KRA indefinitely postpones implementation of EGMS on bottled water and juice - 10 August 2018 

Following extensive consultations between the Kenya Revenue Authority (“KRA”) and various stakeholders in the water and juice industry, the KRA, through a joint statement dated 31 July 2018, postponed the implementation of the Excisable Goods Management System (“EGMS”) on bottled water and juices that was to commence on 1 August 2018. Read more  

Administrative and policy changes in the management of Work Permits regime - 2 August 2018

The Government of Kenya, through the Cabinet Secretary, Ministry of Interior and Coordination of National Government, has issued a report on the just concluded Work Permit verification exercise recently carried out during the period from 21 May to 22 July 2018. Out of this thegovernment issued its recommendations for administrative and policy changes in relation to the management of Work permits. Read more

 

High Court temporarily suspends the implementation of “Robin Hood Tax” - 30 July 2018

The High Court on 19 July 2018 issued conservatory orders suspending the implementation of excise duty introduced by the Finance Bill 2018 in Paragraph 6 of Part II of the First Schedule of the Excise Duty Act, 2015 (“EDA”).  Read more

 

Commissioner General adjusts specific excise duty rates for inflation - 20 July 2018

The Commissioner General (“CG”) of the Kenya Revenue Authority (“KRA”) has vide Gazette Notice No 164 of 2018 adjusted specific excise duty rates for inflation on certain excisable goods in accordance with Section 10 of the Excise Duty Act. The new rates will take effect on 1 August 2018. Read more

 

The Tax Laws (Amendment) Bill, 2018 - 25 April 2018

The Tax Laws (Amendment) Bill (2018) (“the Bill”) was gazetted on the 10 April 2018. In this alert, we provide you with an analysis of the proposals in the bill, the affected products and our view on the proposed changes and the possible impact of the legislation. 

 

High Court Nullifies EGMS Regulation - 18 April 2018

The High Court on 12 March 2018 made a ruling invalidating the Excisable Goods Management System (EGMS) Regulations introduced vide Legal Notice 53 of 2017 on the premise that they were enacted in a manner that did not conform to the Constitution and the Statutory Instruments Act. This alert explores the case and the ruling made. 

The Finance Act 2017

The Finance Act 2017 was assented into law by the President on 21 June 2017.

The analysis captures salient changes that have been effected to the Income Tax Act, 2015, the Tax Procedures Act, 2015, the Value Added Tax Act, 2013 and the Excise Duty Act, 2015 following the enactment of the Finance Bill, 2017. The analysis only reflects changes not originally contained in the Finance Bill and changes to some of the provisions of the Bill. 

 

The East Africa Community Gazette Notice 2017 – 16 August 2017

The East Africa Community Council of Ministers (‘Council’) reviewed the East Africa Community Customs Management Act (EAC CMA) and the East Africa Community Common External Tariff (EAC CET).

 

Tax Amnesty: Remission of interest and penalties

In response to the tax amnesty announced by the Government of Tanzania in the Budget Reading of 2018/19, we have prepared this alert to give you an overview, and responses to frequently asked questions with respect to the provisions under the Tax Administration (Remission of Interest and Penalty) Order, 2018. Read more...

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